This blog is based on an article in Social Policy and Society. Click here to access the article.
A large number of often large-scale land acquisitions have led to many conflicts in different parts of the world. One of the contributing factors behind these conflicts is the inability to understand that land has plural values, i.e. the land has values beyond monetary price. Social policy literature has already recognised this via Marshallian theorisation of social citizenship. The empirical evidence collected at land acquisition case study areas in India suggests that any property rights system that heavy-handedly enforces absolute ownership and control (via exclusion of others) might often ignore the existing social realities, which includes plural values of land. The existence of plural land values encourages us to rediscover the subordination of market price to the ideals of social justice.
In 2008, Tata Motor’s proposed Nano car factory was under development in India. Unwilling farmers and their supporters successfully kicked out Tata’s dream project out of the state/province of West Bengal. This triggered a national awaking and has demonstrated how a successful grassroots movement can stand against the might of the state’s land acquisition drive. Yet, Singur is not the first widely known anti-land acquisition movement. Medha Patkar brought Narmada anti-dam movement in the national and international media. There were at least a few dozens of such movements which took place in post-independent India (1947 onwards) and some of them are still active.
There are many ways to look at these movements. One of the common factors which can be recognised in these movements is unjust land valuation principles used during land acquisition. These valuation methodologies are heavily based on contemporary and dominant theories in social science. However, this empirical investigation suggested that dominant value theories do not adequately present the social realities in the Marshallian citizenship sense, therefore the dispossessed are violently rejecting land acquisition. Marshallian citizenship refers to, in Marshall’s words, ‘subordination of market price to social justice.’ To put it in this context, the existing market price-based valuation does not represent the value, dignity, capability, worth of land, and loss of land to the individuals.
The Original Sin
During my doctoral research, I learned about the ‘popular’ diamond -water paradox of values (1776/1982) and the origin of all contemporary valuation theories. This paradox introduced ‘value in use’ and ‘value in exchange’ concepts that explained why diamond has such a high exchange value (often represented in terms of monetary price) but little use value. It is because scarcity that diamond is more valuable (in exchange) whereas water is lifegiving but less valuable in exchange. For reasons unknown, Smith’s second discussion on the paradox is almost forgotten. The second example also discusses three determinants of price: “1st, the demand or need …seconndly, the abundance or scarcity … riches or poverty of those who demand” (Smith 1766/1896, 176-177). In his next chapter, Smith accepted that the value is represented through price (Smith 1766/1869, 182-190). This is the first documented evidence of everyday confusion, as well as perhaps Smithian confusion over monetary price, representing the value of everything and anything.
The historical evolution of theories of value, which I attempted to cover in my recent paper in Social Policy and Society and my recent book, encourages me to question the ‘monetary price equals value’ obsession in social science literature (for a different ontological root, please see Sandel 2012). Social policy scholars can easily recognise this ontological point. T. H. Marshall’s idea of social citizenship feared commodification of social justice and warned us not to equate monetary price and value. To put it dramatically, Marshall feared the time when market price determined the worthiness of a human being.
Two Issues
This unexpected reading of Smith encouraged me to appreciate two issues. First, whether we have forgotten, in contemporary science and everyday conversation that few have claimed that monetary price equally represents value, including but not restricted to land. During my empirical investigation in Salbani and Singur, whenever I asked anyone about the value of land, the first answers came in terms of monetary price; when pressed further, they have not hesitated to indicate the everyday confusion.
The second issue is the implication of ‘the third’ principle of Smith (1766/1896, 176-177) in understanding the principles of valuation. The “…riches or poverty of those who demand” encourages us to look beyond simple demand-supply equilibrium. My reading of Smith’s second discussion suggests that the value of anything, including land, is dictated by the fortunes of the bidders or wealth of the individuals. The fortunes of the bidders give enormous (often extra-legal) power over the potential sellers. They can either increase the monetary price of the object or thing or decrease the price. With this understanding of the third principle, the simple demand-supply explanations of value/price become meaningless. This at the same time cautions us against Marshallian fear.
Conclusion
Unless the social sciences, especially dominant theories of economics, apply their science into practice and flirt with the term ‘art’ or recognise the ‘social’ in human existence, neither the market economy can function efficiently nor the Marshallian idea of social citizenship will be ever realised.
About the author
Sattwick Dey Biswas is a Research Fellow at the National Law School of India University
The Social Policy Blog 